The Department of Homeland Security’s proposed STEM OPT extension fails to protect foreign students and American workers

For decades, the Optional Practical Training (OPT) program has permitted foreign graduates of U.S. universities, who visit the United States to study through the F-1 nonimmigrant visa program, to be employed in the United States for up to 12 months immediately after graduation. In 2008, the George W. Bush administration extended the OPT program period to 29 months for F-1 graduates of a science, technology, engineering, or math (STEM) program—known as the STEM OPT extension—through an Interim Final Rule (IFR) promulgated by the Department of Homeland Security (DHS). On August 12, 2015, the U.S. District Court for the District of Columbia struck down the 2008 IFR, ruling that the regulation was illegally created in violation of the Administrative Procedure Act. Judge Ellen Segal Huvelle vacated the IFR effective February 12, 2016.

On October 19, 2015, President Obama proposed new DHS regulations that would reinstate the STEM OPT extension and increase its duration from 29 months to 36 months per STEM degree for foreign STEM graduates, and allow the extension eligibility to apply to up to two STEM degrees. Effectively, this would allow foreign graduates with STEM degrees to be employed for up to six years while on an F-1 visa. The DHS regulatory notice solicited comments from the public. In our comment, we argue that the president’s STEM OPT extension proposal is problematic for several reasons:

The STEM OPT extension program has no authorization in the law and was created entirely via executive fiat by the George W. Bush administration in 2008, which extended the original OPT program period from 12 to 29 months. Except for a three-year pilot program in 1990 (which expired shortly thereafter), Congress has never explicitly authorized the employment of foreign students on F-1 visas for 12, 29, 36, or 72 months.

The STEM OPT extension program masquerades as a mentoring and training program for foreign graduates with STEM degrees from U.S. universities; in practice it is a large temporary work-visa program for foreign workers with virtually no rules.

There are no enforceable wage standards or protections for the foreign students in the OPT program or for the U.S. workers with whom the OPT workers compete. Employers are permitted to deeply undercut locally prevailing wages for jobs in STEM fields. Employers are not required to first recruit U.S. workers or even publicly advertise jobs to them before hiring OPT workers, meaning that employers do not have to establish the existence of a labor shortage before hiring workers through OPT.

The STEM OPT program makes de facto guestworkers significantly cheaper than U.S. workers by waiving the employer’s obligation to pay federal payroll taxes. This creates a financial incentive for employers to hire OPT employees instead of U.S. workers in STEM jobs, which is an obvious disadvantage for U.S. workers, most of whom are likely to be recent STEM graduates seeking entry-level jobs.

The program will further reduce employment opportunities for U.S. graduates in STEM fields. And because the OPT is a de facto guestworker visa that can last as long as six years and has no annual numerical limit, its existence will encourage more foreign students to study in the United States in hopes of remaining here to work, leaving fewer educational opportunities for U.S. students.

There is no justification for extending the OPT work permit from one year to three or six years that is not based on the educational needs of foreign students or on the needs of the U.S. labor market. A 12-month work/training period is more than adequate for any STEM degree program.

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